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A-List Insights: Nick Najjar (Part 3)

Welcome to A-List Insights!

A-List Insights is an interview series where we talk with industry thought leaders and experts about different topics surrounding logistics and supply chain – gathering their insights and experience firsthand.

Thought Leader: Nick Najjar

Part 3 of 6

In this segment of our Insight Series we feature Nick Najjar, Director of Distribution Planning at Land O’ Lakes, Inc. Nick has been a supply chain professional with the company since 2010, holding several positions across the logistics organization on the network design and analytics, transportation, and warehousing teams. Prior to his current role, Nick led transportation operations and procurement for all three Land O’ Lakes’ business units, and was responsible for enhancing the customer experience and championing innovation and visibility initiatives in the transportation space and last mile logistics.

Nick has been a speaker at the Gartner Supply Chain Executive Conference, the Council of Supply Chain Management Professionals Annual Conference, and has been interviewed and featured across several industry publications including Logistics Management, The Global Cold Chain Alliance’s Cold Facts, and Freightwaves.

Before joining Land O’ Lakes, Nick served 5 years as a US Army officer, completing combat tours in both Iraq and Afghanistan, and is a graduate of the University of Wisconsin-Madison.

This is the third of a six part series interview with Nick. To provide context to the current climate, the entire interview was conducted in early May 2020, in the midst of the worldwide COVID-19 pandemic. Look here to find Part 1 and Part 2.

Part 3: Shipper/Carrier Collaboration and Capacity Constraints

What do you think shippers could be doing to be building better relationships with their carriers, or how important do you think shipper and carrier collaboration is?

It’s incredibly important. I would say the more transparent you are, the more that you’re sharing, the better it is for both parties. If I think about how can you find that sweet spot between cost and service is what’s best for both parties.

Things have evolved over the last few years, and some of the things we were talking about this time last year at Gartner [Supply Chain Executive Conference] were ‘how do you leverage visibility solutions?’, ‘how do you leverage digital-based brokerage?’ and things of that nature where you really have a far more transparent view of the marketplace, so you get out of this, for lack of a better expression, gamesmanship.

Spending less time trying to find working through that consensus on cost vs service, and having confidence, both as a shipper and as a carrier, just normalizing what the market realities are, what the market reality at that time is, and taking that out of the exercise so that both parties can focus on ultimately delivery.

I’m going to ask the question in a different way. What do you think the risks are of not working collaboratively?

There’d probably be less fundamental predictability to what your costs are going to be on the shipper side, or revenue on the carrier side. If you’re not playing that way and you’re not partnering in both directions, and you’re not having transparent conversation…you know if you’re looking for the hot deal as a shipper today and getting it, you’re probably going to pay for it tomorrow, and vice versa.

It gets back to an earlier comment that it’s a fundamentally cyclical industry, and if you want steady service and relative cost predictability, those are the risks you’re leaving on the table if you don’t operate that way [collaboratively].

So, how have you, as a large shipper, dealt with capacity constraints relative to containers or driver shortages or temperature-controlled vehicles?

One is being absolutely as transparent as we can with what we anticipate in our own demand. All our businesses have some inherent seasonality to them, some more than others, but they all have inherent seasonality.

Dairy foods has baking season, Purina has certain expo seasons and colder weather at the beginning and end of the year when animals can’t forage to the same degree so there’s a natural spike in demand, and then of course agriculture is the most seasonal of them all where we have this massive rush from roughly April through June as crop is going into the ground and as crop protection products are being applied, and the vast majority of our annual demand is falling within a 3 to 4 month window.

So one is being as transparent with the details of that and what the service expectation with our carriers is. I would say that is the basic blocking and tackling, and something we have been doing for years.

It gets back to what are you doing in your quarterly and annual business reviews with your strategic partners, and having forward looking conversation to say ‘how much of this can you support?’, ‘how much are we going to have to work together to put out onto the spot market?’, and ‘are there other solutions we can put in place?’

For our agricultural business, for example, we’ll bring in for a period of time committed assets and pay accordingly, and it gets back to that transparent discussion around this is the service that’s a table stake for that business, and how do we engineer a solution. And then in the last couple of years, we’ve started to play more in the space of visibility solutions and digital-based brokerage to get even more responsive.

Look for Part 4 of our “A-List Insights” Series interview with Nick Najjar where we discuss sustainability in logistics and supply chains; and the value of logistics and supply chain software technology.

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